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expectation that development costs will be recovered. We have witnessed an unexpected paradox: the profitability of orphan drug development. The sales of several orphan products have far outstripped their original R & D costs. |
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In reaction, several amendments to the Orphan Drug Act have been proposed, none of which have been enacted into law, including a windfall profit tax on orphan drugs that become excessively profitable; removal of orphan status if the target populations exceeds 200,000; decreased exclusivity from seven to four years with an additional three years available for drugs with limited commercial potential [69]. Would changes to the Orphan Drug Act decrease orphan drug research incentives? Some believe that pharmaceutical companies will no longer be willing to drill all the dry holes needed to discover oil. |
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Other proposed changes to the Orphan Drug Act would encourage new drug development. One proposal is to amend the Orphan credit so that drugs developed to treat AIDS would be considered orphan drugs. Another proposal extends or makes permanent the Orphan Drug Development tax credits that expire on June 30, 1995 [70]. |
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Often uses of a product are discovered after FDA approval. Manufacturers do not follow up on such uses because approval of a supplemental NDA is required, and two full clinical trials must be carried out to obtain such approval. The cost becomes prohibitive. In addition to the cost involved, supplemental approval times are generally longer than the original applications for the same drugs and the product's patent may expire in the time it takes to do the clinical trials, allowing generic manufacturers to market the drug for the new and old indications, without the burden of research costs [53]. Although generic manufacturers cannot market their drugs for new indications for three years after the pioneer firm has obtained supplemental NDA approval, physicians can prescribe or pharmacists can dispense the generic for new indications. To resolve the problem of off-label uses, FDA has begun to encourage certain manufacturers to file supplemental NDAs that the FDA has suggested they will process more quickly than would normally be the case. |
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The Investigational New Drug (IND) approval process is fast becoming a significant impediment to R & D, prompting more and more researchers to conduct clinical trials overseas where regulatory requirements are less demanding. Only about 20% of Phase I studies are now conducted in the United States and while the actual number of clinical holds has not increased in recent years, there are more informal holds and partial holds imposed by the FDA [33]. Many believe more flexibility is needed in the approval of Phase I trials to prevent the bench-to-clinic bottleneck that is occurring. As a result, there is growing pressure to simplify and streamline the IND review process. |
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